Fleet Insurance: Managing Your Risk

Managing a business—regardless of its size or industry—can be exhausting work, especially if you have to maintain a small fleet on top of your day-to-day responsibilities. Most insurers define a small fleet as being between two and 15 vehicles.

Therefore, whether you have only a couple of vehicles or more than a dozen, managing their collective risks can sometimes feel like a constant uphill struggle. While it may seem like an imposing challenge to get ahead of all the potential risks that may affect each of your vehicles, doing so can save your business countless time and money down the line.

For that reason, instead of choosing to address risks as they develop, consider investing in small motor fleet risk management strategies to pre-emptively address potential issues. By implementing these straightforward strategies, you can ensure that your business is protected from potential business interruptions, costly fines and reputational damages.

Potential Risks Affecting Small Fleets

As with every other aspect of your business, your small fleet may be exposed to numerous unforeseen risks. The following are some of the most damaging and costly risks to look out for:

Fatigue—Fatigue is one of the most common causes of car crashes. Too little sleep and long hours on the road can cause drivers to become drowsy, which can leave them susceptible to making driving errors or even falling asleep.
Mechanical failure—If the vehicles that comprise your fleet are serviced infrequently, there is the potential that they could break down, have reduced performance or cause an accident.
Inclement weather—Inclement weather conditions can significantly impact driving conditions, as it could decrease visibility, toss debris into the road or cause driving surfaces to become slick.
Distracted driving—Using a mobile phone (hands-free or otherwise), fiddling with the radio, eating and drinking, or using a sat-nav while driving can distract your drivers from paying attention to road conditions and other motorists.
Road rule nonadherence—The Highway Code was developed in order to protect motorists as well as pedestrians. By ignoring those rules—such as posted speed limits or rules forbidding hand-held mobile phone use while driving—drivers place not only themselves but others at risk as well.
Under- or inadequately insured fleets—If your business is under- or inadequately insured, you could be held liable for costly fees in the event of an accident.

How to Mitigate Potential Risks

While it may seem inevitable that your business’ small fleet will have to endure one or more risks, there are simple risk management strategies you can implement in order to mitigate the probability of their occurrences. These strategies include the following:

Monitor fleet and driver performance with telematics. Telematics can allow your business to closely monitor and measure the performance of each vehicle and driver. In fact, you can track and record a vehicle’s speed, braking and cornering. By regularly reviewing this data, your business can identify problems—such as vehicle and driver performance or route effectiveness—and devise solutions to address them.
Install dash cams in each cab. Dashboard cameras (also known as dash cams) are cost-effective devices that can record both what is occurring in front of the vehicle as well as the driver. This video evidence can help protect your business from fraudulent motor claims if a driver is involved in an accident, and it can ensure that a driver is paying attention and following the rules.
Implement a driver excess policy. By including driver excesses for at-fault claims as part of your fleet policy, you can encourage your drivers to take better care of the vehicles as well as motivate them to practise better driving behaviours.
Provide drivers with annual training. You should provide annual training for your drivers to ensure they are able to safely and effectively perform any given task behind the wheel. In addition, you should cover safe driving practices and discourage drivers from practising inattentive or distracted driving habits. If a driver is involved in an accident—regardless of whether it’s major or minor—you should have them retake the course to mitigate the potential of it happening again.
Conduct routine maintenance on each vehicle at scheduled intervals. Each vehicle in your fleet should undergo a thorough inspection at least once a quarter. This inspection should include: tyre inspection, oil change (if necessary), topping up fluids, brake inspection and engine inspection, among other steps. In addition, you may also want to inspect the vehicles at the start of winter when driving conditions can become more treacherous.
Verify driver performance and vehicle quality with driver checklists and accident logbooks. Consider developing a driver checklist that a driver must sign and complete before they can depart. Potential checklist items may cover whether the merchandise is properly secured, there is any visible damage to the vehicle, the safety equipment is working properly and the indicators function. In addition, each vehicle should have its own logbook to be used in case of an accident that outlines what happened, what repairs were completed and by whom, and who was driving at the time of the accident. Keeping detailed notes about an accident will be helpful when your business files an insurance claim.
Purchase comprehensive small fleet insurance. By purchasing comprehensive small fleet insurance, you can ensure that your business is protected. The policy may provide employer’s liability insurance, public liability cover, breakdown cover, goods in transit cover and business interruption cover.

Keep Your Small Fleet Moving

If your business does not adopt a proactive approach to managing your small fleet, you may spend a great deal of time and money trying to contain all of your emerging risks. However, by implementing small motor fleet risk management strategies, you can stay ahead of all of your risks and ensure that your fleet, your drivers and the public remain safe. In addition, this approach can also allow you to invest your time and finances into bolstering your business rather than just trying to respond to problems as they occur.

For more information on how you can best protect and enrich your business, contact our Motor Trade Insurance experts today.